US Finalizes Overhaul of Natural Gas Export Reviews

Posted by Eric Haun

Thursday, August 14, 2014

The U.S. Energy Department has finalized a plan to revamp its process for approving liquefied natural gas exports, and as originally proposed the changes eliminate conditional approvals for LNG projects.

Beginning Thursday, the department will only issue final rulings on whether exports are in the public interest after the Federal Energy Regulatory Commission, or another authorized agency, has completed an environmental review of the project.

The move will likely shift focus from the Energy Department, which has been criticized for moving too slowly, to the more costly FERC process, which assesses the safety and environmental impacts of LNG export facilities.

Making an export application with the DOE costs about $20,000 but companies pay up to $100 million to complete the FERC process, an investment that separates serious projects from those without the financial backing to actually construct what are often multibillion-dollar facilities.

The new policy will not affect companies that have already received conditional approvals, such as Dominion's Cove Point project, Sempra's Cameron LNG project and Leucadia National Corp's Oregon LNG project.

Cheniere's Corpus Christi project, which is due to receive its final environmental review from FERC in October, is the first facility in line to get a permit from the Energy Department under the new process.

The administration has been under pressure from backers of LNG exports, including many Republican lawmakers and some Democrats from oil and gas states, to streamline the approval process for LNG projects.

The changes were originally announced in May and were subject to a public comment period. More on the changes can found here: http://bit.ly/1sZ3y4i